Toyota Predicts China Sales Won’t Fully Recover Before Autumn

Toyota is displaying 52 models at this year’s Shanghai Auto Show -- including two China-specific world premieres -- as it seeks to reverse its first annual sales decline in the country in at least a decade. Photographer: Koichi Kamoshida/Bloomberg

April 22 (Bloomberg) -- Toyota Motor Corp., Japan’s largest
automaker, said it doesn’t expect sales in China to fully
recover before autumn this year as antipathy lingers among the
country’s consumers toward Japanese brands.

“Our original expectation was for sales to come back in
half a year, but now our plan is to push harder after our new
product introductions in the fall,” Hiroji Onishi, Toyota’s
China head, told reporters in Shanghai yesterday. “We’ll be
focusing more on inland areas and also the younger generation.”

Toyota is displaying 52 models at this year’s Shanghai Auto
Show -- including two China-specific world premieres -- as it
seeks to reverse its first annual sales decline in the country
in at least a decade. The models include the Yundong Shuangqing
II, a hybrid concept being developed in Changshu, China, and the
FT-HT Yuejia, a six-seater designed to appeal to young Chinese.

“It’s important for Japanese carmakers to develop China-specific cars, or use more local designers to better tailor
their cars to local taste,” said Lin Huaibin, a Shanghai-based
analyst with IHS Automotive. “Japanese carmakers have
traditionally put less emphasis on China, and that’s at the core
of why their market share has declined.”

Sales of Japanese cars in China plunged late last year
after tensions escalated over ownership of uninhabited islands
known as Diaoyu in Chinese and Senkaku in Japanese. The dispute
led Japan’s automakers including Nissan Motor Co. and Honda
Motor Co. to cut profit forecasts and reduce output in China.

Sales Slump

The carmaker gained 2.4 percent to 5,610 yen in Tokyo
trading as of 10:59 a.m. The shares have climbed 40 percent his
year, compared with the 31 percent gain in the benchmark Nikkei
225 Stock Average.

Toyota sales in China fell 4.9 percent to 840,500 vehicles
last year, the first annual drop based on company figures
stretching back to 2002.

The Toyota City, Japan-based automaker in January pushed
back plans to make China its third million-unit market, after
the U.S. and Japan, until 2014 at the earliest as it waits for
anti-Japan sentiment to subside and for demand to improve. The
maker of Camry sedans expects deliveries in the country to rise
about 7 percent to 900,000 vehicles in 2013, it said at the
time.

The automaker, which announced a new Lexus ES assembly line
in the U.S. on April 19, is also considering producing the
luxury model in China in the future, Onishi said yesterday,
without being more specific.

Separately, Toyota said work will resume today at its plant
in Chengdu, China, which it temporarily halted after the April
20 earthquake in Sichuan province. Toyota had suspended
production and told employees to go home to ensure the safety of
their families.

The Chengdu factory wasn’t damaged, Akihiro Yamamoto, the
Japanese carmaker’s China executive coordinator said yesterday
in Shanghai, where he was attending the auto show.